Child and Family Services in Michigan: Privatization Works!

(The following is adapted from recent testimony by Mr. Maxey before the Michigan Senate Committee on Mental Health, Human Resources, and Senior Citizens.)

The privatization of services to children and families has a long and successful history in this country. That's especially true in Michigan, where both state and local governments make extensive use of contracts with non-profit groups.

Sixty-five such non-profit and community-based organizations are members of the Michigan Federation of Private Child and Family Agencies. Under contract with the state's Department of Social Services (DSS), they provide about two-thirds of the care to Michigan's troubled children and families. That includes the majority of the "Families First" programs, the largest family preservation effort of its kind in the nation.

As Executive Director of the Federation, I can attest to the fact that the Families First program has attracted considerable favorable attention from other states, the national media and the Congress. Susan Kelly, its DSS manager, terms it both a fruitful and "realistic way to treat families that are at risk." DSS Director Gerald Miller agrees and has said he "generally favors privatization."

When state and local governments cooperate with private agencies in social service delivery, examples of heart-warming success are easy to find. The caring people of private agencies know they must do a good job or go out of business.

In Lenawee County, therapists employed by Family Counseling and Children's Services work with entire families to address financial concerns, alcoholism, marital problems, parent-child relationships and individual stress.

In Grand Rapids, Wedgwood Acres/Christian Youth Home has developed an exemplary project with Kent County that effectively reduces out-of-home care for severely-disturbed children from nine months to 90 days.

These and numerous other examples have led many individuals in and out of state government to endorse the privatization concept, including Gov. Engler. In late 1990, he advised Federation members that private agencies would be the key providers of child and family services in his administration. His press secretary recently said, "We are committed to the private sector."

Pointing to the delivery of adoption and foster care programs as good examples, Sen. Robert Geake has noted that "Almost anything the state does can be provided better and more efficiently by the private sector." In fact, studies have strongly suggested that the private sector in Michigan can provide a wide range of social services of equal or greater quality than the state, and at savings of as much as 38 percent.

Regarding foster care in particular, a study to be released soon by The Mackinac Center clearly documents that "it is less expensive for taxpayers to have it supervised through private agencies than for this service to be provided directly by the Department of Social Services."

The record solidly supports privatization of mental health services also. Since the deinstitutionalization movement began three decades ago, Michigan's private agencies have taken on increasing numbers of child mental health cases in cooperation with the juvenile courts and DSS. They now deliver the vast majority of services to the children so affected, sometimes at one-third of the cost for state facility care.

Privatization of child and family services is both a national and a Michigan tradition which springs from free enterprise and the spirit of community. As state officials search for ways to more fully take advantage of this option, they will find a private sector with an admirable track record and an eagerness to cooperate.

SKU: V1992-03

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